SJM Holdings said its 2015 profit plunged 63.4 percent, hurt by the suspension of operations at the Casino Greek Mythology and tumbling gaming revenue.
Net profit attributable to owners of company was HK$2.46 billion ($317 million), or 43.5 cents a share. The amount includes an impairment loss on available-for-sale investments in equity securities of HK$250 million and the impact on profit of the suspension of its Greek Mythology satellite casino of HK$143 million.
Adjusted profit would have decreased by 57.5 percent over 2014 to HK$2.85 billion.
Total gaming revenue of $48.6 billion, was down by 38.7 percent. Adjusted EBITDA was $3.86 billion, a decrease of 50.3 percent from the previous year.
For Q4, net revenue was HK$11 billion, down 35 percent and adjusted EBITDA fell 45 percent, which Bernstein Research said was in line with its forecasts.
SJM says it expects its Grand Lisboa Palace resort on Cotai to open in late 2017. The company is in discussions to find bank financing and said it expects to conclude talks later this year.
SJM expects to be able to celebrate the topping-off of the building’s superstructure around mid-2016.
Upon completion, the Grand Lisboa Palace will comprise total gross floor area of 521,435 square metres plus 77,158 square metres of parking area. More than 90 percent of the total area will be devoted to a full range of non-gaming facilities, including hotel towers bearing the insignia ‘‘Grand Lisboa Palace’’, ‘‘Palazzo Versace’’ and ‘‘Karl Lagerfeld’’, totaling approximately 2,000 rooms. The estimated construction cost is about $30 billion.
“In the long-term, we believe SJM will continue to trade at a valuation discount to its peers due to its over reliance on VIP and satellite business, conflicts of interest, complicated shareholder structure and governance concerns,” Bernstein said.
In Q4, the company reported a decline in GGR of 35 percent, which was weaker than the market’s overall decline of 27 percent.
VIP GGR dropped 47 percent to $5.4 billion, while mass and slots GGR was down 19 percent.